UPDATE 3-J.C. Penney, Ackman in talks to resolve dispute -source

Mon Aug 12, 2013 7:22pm EDT
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By Matthew Goldstein and Dhanya Skariachan

Aug 12 (Reuters) - J.C. Penney Co Inc and hedge fund Pershing Square's Bill Ackman are in talks to resolve their dispute over the leadership of the U.S. retailer, a source familiar with the situation said on Monday.

Penney and Ackman could reach a deal as early as later on Monday, the source said. The source added that a final deal had not yet been reached and talks could still fall apart.

A Penney spokeswoman was not available for comment on the talks.

The public battle between Penney and Ackman escalated late last week with the hedge fund manager demanding the ouster of the retailer's chairman Thomas Engibous as well as the interim CEO Myron Ullman. Ackman had demanded that Ullman be replaced within the next 30 to 45 days.

While Ackman publicly feuds with Penney, other large investors in the struggling retailer are staying pat.

Soros Fund Management LLC is holding onto its 7.9 percent stake in Penney, a source familiar with the matter said on Monday. The firm backed by billionaire financier George Soros had reported earlier this year a big stake in the department store operator.

Another large Penney investor, Glenview Capital Management, also appears to be sitting tight on its "passive" 4 percent stake in the retailer. A person familiar with the hedge fund led by Larry Robbins said the firm has not taken any sides in the public dispute between Ackman and Penney's board.   Continued...